Federal Laws and Online Gambling
Several federal criminal statutes can be implicated by illegal Internet gambling. Among them are the Illegal Gambling Business Act (IGBA), the Wire Act, the Travel Act and the Racketeer Influenced and Corrupt Organizations Act (RICO). In addition to state law, these laws reinforce each other and impose hefty fines and imprisonment on the operators of these illegal gambling operations.
While the Travel Act has no statutes that are specific to Internet gambling, it does prohibit money laundering and the promotion of illegal gambling. It also prohibits gambling on interstate commerce and the distribution of gambling proceeds. In addition, it provides penalties for the laundering of illegal gambling proceeds.
The Travel Act is also the operative word in two of the most important Internet gambling cases. One involved the Internet and the other involved a Costa Rican casino operation. In the former, the government seized 3.2 million dollars from Discovery Communications, while in the latter, the federal marshals confiscated the cash.
In terms of ooh-la-la, the Travel Act’s biggest achievement is the fact that it can be used to prosecute gambling operations. It is not hard to imagine that state governments will be reluctant to enforce their own laws when faced with foreign elements like Internet gambling. In addition, the aforementioned statutes can make it difficult for state law enforcement officials to make their case.
Despite the fact that state law has a hand in the creation and enforcement of gambling laws, it does not have the same sway as federal law. In order to prove a gambling operation’s worth, it must be operated in a state that has a corresponding law. As a result, state officials have expressed concerns that the Internet may be used to facilitate illegal gambling in their jurisdictions.
It is not difficult to see why the aforementioned laws are being challenged on constitutional grounds. Whether or not the Commerce Clause is the right ax to strike is an open question. Nonetheless, it is the best tool to date to combat the influx of illegal gambling on the Internet. This is particularly true where federal law reinforces state law. Moreover, a commercial nature of a gambling business appears to serve as a necessary buffer.
In fact, a number of state governments have even gone so far as to adopt statutes aimed at regulating Internet gambling. The Internet Gambling: An Overview of Issues is a comprehensive study of the legal, technological and policy implications of online gambling. Among the issues addressed are whether the law should be interpreted as a federal or state matter. Among the statutory requirements for an illegal gambling business are that the business be located in a state that has an enforceable gambling law, that the business have a gross revenue of at least $2,000 per day, and that it be operated for at least two days a week. The laws can be complex, but state officials appear to be on the right track in their efforts to keep the Internet safe and pristine from illegal activity.